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The real estate crash in 2008 made many people afraid to invest in real estate. Things have finally settled down, and mortgages are still at record lows. Before the real estate market increases, it is a great time to purchase a piece of real estate.
- Home Prices have Leveled
Home prices have been on a rollercoaster ride in the last few years. They bottomed out and then the prices quickly rose. Now, the prices are projected to slow down. They may rise by a small amount, but the rollercoaster ride has ended.
This will open the chance for those who weren’t able to spend the high price a few years ago. For people in the low and middle class, purchasing sooner than later is a wise idea. Many reality websites, like pattayarealestate.com, are urging future homebuyers not to wait. Once increase rates rise, the purchase may be out of range because of stagnant wages.
- More Available Homes
Because of the slowdown in the rise of home prices, more homeowners are going to be prompted to list their homes for sale. This will be the perfect opportunity for buyers to have a large selection of homes.
Builders expect a surge of starter and smaller sized homes, as young couples take advantage of the level prices. One of the benefits of more homes on the market is that it will decrease the chances of a bidding war. Bidding wars are known to drive up prices.
- Catch the Low Interest Rates
Experts believe that the Federal Reserve will begin to increase interest rates. Now is the best time to take advantage of the lower interest rates before the increase begins. This time period has given homebuyers some of the lowest mortgage prices on record. Once the interest rate is increased, mortgages will increase.
- Buying is Cheaper than Renting
This isn’t the typical experience, but it is for now. Rent prices have been on the rise for some time now. They have outpaced home values in the last year. In most areas of the country, buying a home will be cheaper than renting. Home interest rates would have to greatly increase to make renting the cheaper option.
Rental prices are expected to continue to increase by at least 8% in 2016. If one is in a position to purchase, renting a home or apartment for the same price as owning a home makes no sense. It is essentially handing over money that could have been used as an investment.
- Smaller Down Payments
One of the biggest reasons that people shy away from purchasing a home is the large down payment required upfront. There are a variety of programs available through banks and the government that allow for smaller down payments. Some programs allow a down payment as low as 3%. This opens up home ownership to more people.
- Low Mortgage Insurance
When one places less than 20% down as a down payment, banks require mortgage insurance as a precaution measure. Mortgage insurance is at an all-time low as well. Some companies charge fees as low as 2%. This helps keep the mortgage total lower than expected.
Despite some economic and political turbulence in the world today, many investors are allocating more money towards foreign real estate investments. Global investments are going to increase the previous years. There are a number of places that investors are focusing their investments, including larger cities and upcoming vacation spots. Investors are looking for places to build shopping malls, warehouses, luxury hotels, offices and even more.